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Restraining Overconfident CEOs Through Credit Ratings
No full textABSTRACT Overconfident CEOs significantly reduce their acquisition activity when facing a higher risk of a credit rating downgrade, possibly because credit ratings impact their ability to access external financing. Investment‐grade firms managed by overconfident CEOs that are placed on a negative rating outlook reduce their acquisitiveness by approximately 16 percentage points. Our findings offer a novel perspective on the role of credit rating agencies as an external control mechanism, constraining overconfident managers from pursuing value‐destroying acquisitions. Our findings survive a battery of robustness checks, including endogeneity, controlling for internal control mechanisms and market reaction tests
The Value of Control in Private Companies
No full textAbstract The controlling shareholder of a company has the potential to extract private benefits of control (PBC). In contrast to shared benefits, PBC are proceeds that accrue only to the majority shareholders. They can take a variety of forms that range from outright theft to a (covert) compensation for private costs incurred in controlling the company. It is notoriously difficult to measure PBC and the literature only provides a rough guidance based on two methods: the control premium method and the voting premium method. These two methods are based on the logic that PBC must be the reason why the controlling shareholder pays a premium over the market price for a controlling block or why voting and non-voting shares are priced differently. This paper introduces a third method to estimate the PBC. We look at the discount (compared to a baseline valuation made at the controlling level) that minority shareholders ask to invest in a company. In the context of private companies, we find a discount of 16.72 % that translates into estimated PBC of 20.08 % (premium per share). We argue that the discount for lack of control can be explained as a discount for private benefits
The Palgrave Encyclopedia of Private Equity
No full textMergers and acquisitions (M&A) by venture capital-backed companies have witnessed a surge in popularity in recent years. This article aimed to comprehensively examine this subject from the buyer perspective. Firstly, we demonstrate that venture capitalists assume multiple roles in M&A deals, including traditional screening, monitoring, advising, and coaching. Secondly, drawing from signaling, agency, resource-based, and organizational learning theories, one might anticipate a higher propensity for VC-backed companies to engage in acquisitions. However, the existing literature presents conflicting findings regarding the likelihood of VC-backed takeovers. Likewise, the assessment of short-term and long-term performance outcomes, typically measured through stock returns, yields inconclusive results
Beyond lazy; external locus of control as an alternative explanation for the privacy paradox
No full textPurpose The privacy paradox refers to the situation where users of online services continue to disclose personal information even when they are concerned about their privacy. One recent study of Facebook users published in Internet Research concludes that laziness contributes to the privacy paradox. The purpose of this study is to challenge the laziness explanation. To do so, we adopt a cognitive dispositions perspective and examine how a person’s external locus of control influences the privacy paradox, beyond the trait of laziness. Design/methodology/approach A mixed method approach is adopted. We first develop a research model which hypothesises the moderating effects of both laziness and external locus of control on privacy issues. We quantitatively test the research model through a two-phase survey of 463 Facebook users using the Hayes PROCESS macro. We then conduct a qualitative study to verify and develop the findings from the quantitative phase. Findings The privacy paradox holds true. The findings confirm the significant influence of external locus of control on the privacy paradox. While our quantitative findings suggest laziness does not affect the association between privacy concerns and self-disclosure, our qualitative data does provide some support for the laziness explanation. Originality/value Our study extends existing research by showing that a person’s external locus of control provides a stronger explanation for the privacy paradox than the laziness perspective. As such, this study further reveals the boundary conditions on which the privacy paradox exists for some users of social networking sites, but not others. Our study also suggests cognitive dissonance coping strategies, which are largely absent in prior investigations, may influence the privacy paradox
Proceedings of the Hawaii International Conference on System Sciences (HICSS)
No full textContributing digital resources (CDR) is an emerging process that enables companies to capitalize on their digital resource investments by positioning them as value propositions. These value propositions can then be used to meet the needs of integrating companies. CDR can help companies to adapt based on changing market conditions by integrating digital resources from contributing companies instead of developing these resources themselves. An example of such CDR is the collaboration between Stripe and AirWallet, where Stripe has positioned their payment processing digital resource to AirWallet, so that it can be integrated into their mobile wallet platform to facilitate seamless payment experiences. This paper explores how value is created when companies contribute digital resources to meet the needs of other companies. Using resource-based view theory, we conceptualize the dimensions of value by describing the value proposition positioning and leveraging strategy. Through four illustrative case studies, we examine contributions of digital resources in collaborations, proposing a theoretical framework and testing it empirically
From analytics to empathy and creativity: Charting the AI revolution in marketing practice and education
No full textThe rapid advancement of artificial intelligence (AI) increasingly demands an understanding of its impact on marketing practice and education. Our hybrid literature review synthesizes 312 peer-reviewed articles on AI in marketing and consumer behavior, using scientometrics and the TCCM (Theory, Context, Characteristics, Methodology) framework. We identify five research areas: human–AI interaction in services, natural language processing (NLP) and computer vision for consumer insights, AI for e-commerce and decision support, marketing automation and creativity, and AI ethics. AI’s evolution is marked by a transition from analytical to empathetic and intuitive technologies like affective computing and generative AI. We highlight the changing dynamics between humans and AI, AI integration in marketing practices and education, and the transformed AI-enhanced marketing workplace. We underscore the significance of ethical considerations, the well-being of users, and the integration of generative AI tools. This review provides a comprehensive guide for forthcoming research, practical applications, and educational advancements in AI-enhanced marketing
The influence of emotions and communication style on customer satisfaction and recommendation in a call center context: An NLP-based analysis
No full textWe study the impact of customer sentiment, agent sentiment, and emotional matching (i.e., call center agents matching emotional expressive states of customers) on satisfaction and recommendation intentions in a utilitarian service context. We methodologically contribute by text mining observed data using advanced transformer-based NLP algorithms and compare findings with those of previous survey-based research. An analysis of 25,008 call center conversations reveals that positive (vs negative) customer sentiment more strongly impacts satisfaction and recommendation. For recommendation (vs satisfaction) we observe that negative emotional expressions have a relatively stronger weight, albeit less strong than that of positive ones. We find that emotional expressions of call center agents (vs those of clients) have a smaller impact on these outcomes. Emotional matching is observed as beneficial, but not necessarily when faced with negative high-arousal emotional expressions. As conceptual grounding, we refer to theorizing around delight, formality, source credibility, emotional arousal and loss aversion
Guarding against deception through news literacy interventions: Impact of issue involvement and participation on young French adults’ fake news vulnerability
No full textIn the so-called post-truth age and the rise of social media, news circulates widely and quickly, leading to information overload. In this context, individuals experiencing high issue involvement tend to engage more with information. Literature has recently focused on news literacy interventions to protect people from fake news. However, few have addressed these initiatives’ immediate and differential effects simultaneously on young adults’ vulnerability to deception. Through three experiments involving undergraduate university students in France, we demonstrate that intervention-based educational methods can mitigate the impact of issue involvement on belief in fake news. Yet, they do not enable individuals to protect themselves in the long run and may even prove counterproductive by triggering information overload. Our study contributes to the research investigating preventive practices to help users arm themselves against fake news in media communication, social media, and social marketing
Motion analysis in adult spinal deformity: A time-driven activity-based costing perspective
No full textImplemented advanced cost-analysis for ASD motion protocol, enhancing clinical applicability. Main cost drivers are staff cost (68.1 %), followed by equipment (30.2 %) and consumables (1.7 %). Discussion of Motion Analysis’ potential in elevating ASD treatment planning and decision making.BACKGROUND: A novel motion analysis (MA) protocol for patients with adult spinal deformity (ASD) was developed within University Hospitals Leuven, aiming for better functional outcomes by improved treatment planning and decision making.
RESEARCH QUESTION: Can insights into the costs of a research-focused MA (RMA) protocol support the transition to a concise clinical MA (CMA) protocol and facilitate its potential adoption as standard clinical care?
METHODS: Time-driven activity-based costing (TD-ABC) was used to quantify the costs directly related to performing the MA protocol. Time durations were derived from observations and interviews and validated using time intervals retrospectively derived from previous motion analyses metadata. Costs were computed based on resource time usage and the per-minute cost of practical capacity. An expert panel then refined the RMA into a CMA protocol by excluding some trials, utilizing cost insights and insights in the potential clinical relevance of trials, including their discriminative abilities, their ability to highlight compensatory mechanisms and their standardization potential. The clinical costs of the CMA were then again calculated using the same methodology.
RESULTS: The average time to perform the RMA was 179.0 minutes and dropped to 130.9 minutes after the expert panel excluded 12 types of motion trials. The total cost of this new CMA was € 220.83. The largest cost component of the CMA was staff costs (68.1 %), followed by the cost of equipment (30.2 %).
SIGNIFICANCE: This study demonstrates how cost insights complement insights on clinical relevance when defining a motion analysis protocol for integration in standard clinical care. Future value- improvements to the protocol should also integrate insights on its impact on treatment outcome.Our sincere thanks go to the staff of the Gait Laboratory at the University Hospitals Leuven, Campus Pellenberg, including Catherine Huenaerts and Professor Dr. Kaat Desloovere, as well as all the collaborators of the IORT (Institute for Orthopaedic Research and Training) who contributed to this work
Automatic selection of the best performing control point approach for project control with resource constraints
No full textThe risk, network, and subnetwork control point approaches are proposed. New project parameters are introduced to model realistic project features. A classification model is built to select the best approach given project features.
The classification model outperforms any single proposed control point approach. Resource variability is the main driver for detecting the best approach.During project execution, the actual project progress shows deviations from the baseline schedule due to uncertainty. To complete the project timely, project monitoring is performed at discrete control points to identify project opportunities/problems and take possible corrective actions. These control points affect the quality of project monitoring and corrective actions, but little guidance is available on identifying situations where the control points pay off the most in terms of project duration. This paper proposes new control point approaches considering the risk, the complexity of the network, and subnetwork information to determine the timing of project monitoring and action taking. Moreover, new parameters are proposed to model more realistic project characteristics. Subsequently, a classification model is developed to select the best performing control point approach given project characteristics. An extensive computational experiment is conducted on a set of 3,810 artificial projects with diverse project characteristics to evaluate the performance of the classification model and further validate it on empirical project data. The computational results indicate that the classification model outperforms the average performance of any proposed control point approaches. The results also show that the resource variability that indicates the resource usage deviations between project activities is the primary driver for detecting the best control point approach for projects with resource constraints